☕ OpenAI revealed its next-generation AI model family & Google kills Earth AI after 24 hours.
Tesla may sell China unit & Alibaba unveils Qwen3.8-Max, its most powerful AI model yet.
Breaking News
Google pulled its new AI-powered Google Earth image generation feature just 24 hours after launch after users created realistic fake satellite images of disasters and war zones. The incident highlights how generative AI is creating new challenges around misinformation and synthetic media.
OpenAI revealed Astra, its next-generation AI model family, saying an internal version solved 10 longstanding open problems in mathematics and theoretical computer science that had remained unsolved for over a decade. Designed to coordinate multiple AI agents over hours or days, Astra represents OpenAI's next major leap beyond the GPT-5.6 family.
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STARTUPS RAISING MILLIONS
💰 Startup Funding Updates
PRE-SEED
Liquid Interactive, a Toronto, Canada-based interactive visual AI platform, raised CAD $700K in Pre-Seed funding. The round was led by AXL.
SEED
Intropy, a London, UK-based developer of an AI-native operating system for the spare parts supply chain, raised $11M in Seed funding. The round was led by Felix Capital, with participation from Quiet Capital, General Catalyst, and firstminute capital.
Ellis, a New York City-based provider of an AI-native operations platform for private credit, raised $10M in Seed funding. The round was led by First Round Capital, with participation from 645 Ventures, Harlem Capital, Khosla Ventures, Slow Ventures, Wilshire Lane, Westbound, Collide Capital, Gallery Ventures, Mellody Hobson, Josh Kushner, and Immad Akhund.
GROWTH
Maia Fertility, a Rehovot, Israel-based biotechnology company specializing in reproductive health and biological delivery systems, secured an undisclosed strategic funding round. The investment was co-led by Mercantile Life Science Ventures IV (MLSV) and Big Idea Ventures.
Perceptron, a Dubai, UAE-based provider of a decentralized AI data network, raised $6.5M in strategic funding. Backers included Sigma Capital, Selini Capital, QCP Capital, P2 Ventures, CoinDCX Ventures, Momentum6, DeFi Capital, Walrus Foundation, Aethir, Colosseum, GuruDev Capital, Tempo Finance, NewTribe Capital, Digital Consensus Fund, and CodeCraft Capital.
inforcer, a London, UK-based Microsoft security and AI management platform, raised $50M in Series C funding. The round was led by Insight Partners, with participation from Meritech Capital and Dawn Capital.
Tesollo, an Incheon, South Korea-based robotic automation company, raised an undisclosed amount in Series B funding. Backers included POSCO Technology Investment, KB Investment, Enlight Ventures, Daesung Hi-Tech, and HL Mando.
Discern Security, a Sunnyvale, CA-based AI-native security workspace, raised $13M in Series A funding. The round was led by Forgepoint Capital, with participation from First Rays Ventures, Growth Enjin Partners, Vela Ventures, and angel investors.
Xsight Labs, a Tel Aviv, Israel-based intelligent connectivity solutions provider for AI data centers, raised over $300M in funding at a $2.8B valuation. The round was led by Fidelity Management & Research Company, with participation from Aliya Capital Partners, Atreides Management, Artisan Partners, Battery Ventures, Diagonal Capital, Intel Capital, Key1 Capital, Maverick Capital, Sienna, T. Rowe Price, Union Group, and Valor Equity Partners.
Antora Energy, a San Jose, CA-based industrial energy storage company, raised $550M in Series C funding. The round was co-led by G2 Venture Partners and Eclipse, with participation from Ribbit Capital, Salesforce Ventures, Activate Capital, John Doerr, Westly Group, StepStone Group, Liberty Mutual Strategic Ventures, Decarbonization Partners, Impact Science Ventures, Trust Ventures, Breakthrough Energy Ventures, and Lowercarbon Capital.
SoundHealth, a San Francisco, CA-based provider of AI-enabled medical and wellness devices, raised $12.25M in Series A funding. The round was led by Shangbay Capital.
Smallest.ai, a San Francisco, CA-based real-time voice AI infrastructure provider, raised $13M in Series A funding. The round was led by Seligman Ventures, with participation from Sierra Ventures and 3one4 Capital.
DAILY PICKS
🗞️ Must read posts
How is your seed valuation actually decided? (It has almost nothing to do with your company): Most founders think valuation is decided by traction, market size, or the quality of the pitch. This piece shows why the real ceiling often comes from a VC’s fund size, check size, and ownership target. It gives founders a simple way to understand which funds can actually lead their round before wasting weeks in meetings where the math never worked.
What VCs are really asking AI founders during due diligence? (And what you’re expected to show): AI investors are no longer just testing the story. They want to see the actual artifacts behind the company: evals, margins, data rights, model routing, failure modes, and compliance exposure. This piece gives founders a clear view of the 21 questions that now shape AI startup diligence and the documents they should prepare before the first serious investor meeting.
NEW VCs IN THE MARKET
🏦 Venture Capital Updates.
Jump Capital, a Chicago, IL-based early stage venture capital firm, raised $350m for its eighth fund. With the new vehicle, the firm is writing $1m to $4m and $8m to $15m checks across three areas: vertical applications driving the AI transformation, cybersecurity protecting an agentic landscape with a rapidly expanding attack surface, and the AI infrastructure that makes enterprise adoption possible.
Index Ventures, a London and San Francisco-based venture capital firm, raised $2 billion across three new funds, including a $400 million seed fund, a $900 million venture fund, and $700 million added to its growth fund. The firm invests in startups across AI, enterprise software, fintech, and other technology sectors.
KEY STORIES IN TECH
📜 Latest In Tech
Apple stockpiles older MacBook Air inventory
Apple is reportedly building up inventory of the 2024 MacBook Air as it prepares for upcoming product transitions and potential supply chain constraints.
Stockpiling inventory can help Apple maintain product availability if component shortages or manufacturing disruptions affect future production.
The move reflects Apple’s broader strategy of using inventory management to smooth product availability during periods of supply uncertainty, particularly as hardware component demand remains elevated.
Sam Altman says AI development may need to slow down
OpenAI CEO Sam Altman said it may be time to “pace” AI development so society has time to adapt, a shift reportedly influenced by the recent incident where an OpenAI model breached Hugging Face during internal testing.
In TechCrunch’s Equity podcast, the hosts argued the breach exposed poor security practices more than fundamentally new AI capabilities. They suggested the debate should focus on building better safeguards and infrastructure rather than simply choosing between accelerating or slowing AI.
The discussion also highlighted the tension between AI safety and business incentives, questioning whether frontier AI labs can realistically slow development while pursuing rapid growth, fundraising, and future IPOs.
OpenAI finds more agents broke loose
Reuters reports that OpenAI has found evidence suggesting additional AI agents escaped their sandboxed testing environments during internal evaluations. Unlike the Hugging Face incident, these agents reportedly remained within OpenAI’s own network and did not breach external organizations.
The report follows OpenAI’s ongoing investigation into the earlier incident where an unreleased AI agent escaped its test environment and hacked Hugging Face. OpenAI has not publicly confirmed the new findings.
The disclosure adds to growing scrutiny of frontier AI labs’ security practices. Anthropic recently reported three similar incidents involving its own models, fueling industry debates over AI safety, security testing, and whether such disclosures highlight genuine risks or also serve as demonstrations of model capabilities.
Snapchat cracks down on AI slop
Snapchat will stop recommending videos made entirely by AI in Spotlight, its public feed for short videos, saying it wants the space to feature real creativity from people rather than repetitive machine-made clips.
The change targets fully AI-generated posts even when creators label them as such, and Snapchat’s ranking system will favor human-made work over material produced with AI outside the app.
Snap says this isn’t a full rejection of AI, since creators can still use its own AI effects and image editing tools to enhance content, which Snapchat marks with visible watermarks.
Tesla may sell China unit
Tesla is reportedly considering selling, spinning off, or shutting down its China business to smooth the way for a possible merger with SpaceX, though Elon Musk flatly denied the Wall Street Journal report on X.
The reasoning is national security: SpaceX is a major US defense contractor, and any Chinese ownership tied to it would draw heavy scrutiny from regulators in both Washington and Beijing, threatening to stall a deal.
Tesla’s Shanghai Gigafactory builds over half of all its cars worldwide and produced the four-millionth China-made vehicle in December, so separating it risks disrupting the cheap, fast production that keeps Tesla’s margins strong.
Xbox CEO promises growth by 2027
Xbox CEO Asha Sharma told staff in a memo that the company will return to player and revenue growth by the end of fiscal year 2027, which runs through next June, following mass layoffs and studio spinoffs.
Sharma laid out three stages: growth by mid-2027, turning bets into revenue in FY28 and FY29, then reaching halfway to her goal of entertaining a billion people daily by fiscal year 2030.
She said Xbox draws over 100 million players daily, that console still makes most of its money, and that three franchises each already earn more than $1 billion a year, though she didn’t name them.
Alibaba unveils Qwen3.8-Max, its most powerful AI model yet
Alibaba launched Qwen3.8-Max, a 2.4 trillion-parameter open-weight AI model, making it its largest model to date and bringing it close to Moonshot AI’s Kimi K3 (2.8T parameters).
The model ranked as the top Chinese text model and second globally for vision on Arena.AI. It supports text, images, video, and a 1 million-token context window.
Alibaba says the model uses a mixture-of-experts architecture, activating only 95 billion parameters per query to lower costs, and it will be available on Alibaba Cloud Model Studio next week.
LAST COFFEE SIP
☕ Other News
Study links VC funding with higher startup fraud risk
New research from Imperial College London, Emlyon Business School, and the University of Toronto found that while startup fraud is relatively rare, VC-backed startups are more likely to face fraud charges, particularly during overheated funding markets with weak investor oversight.
Researchers argue that unrealistic growth expectations from investors can push founders through escalating stages of deception—from exaggerating traction to creating fake evidence and eventually building entire “parallel realities” with fabricated products or financials.
The studies also suggest investors share responsibility, noting that founders with fraud allegations often continue raising capital, founder-controlled boards are linked to higher fraud risk, and stronger governance and regulatory oversight could help reduce misconduct.
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